Minimum Wage Daze: Little Full-Time Work Below the Poverty Line

Recently, Democrats have been pushing an increase in the Federal minimum wage. One of the most popular talking points they use to justify this position is, ‘no one who works full time should have to live in poverty.’ Like other arguments people on the left use, it starts out with an ideal end, rather than focusing on how the means they promote will reach that end. Of course everyone wants fewer people to be in poverty. Although, right out of the gate, they act as if raising the minimum wage can and will achieve that goal.

If the purpose of raising the minimum wage is to give some much needed relief to people below the poverty line, then proponents are in large part wasting their time. According toCensus.gov, in 2013, out of the 45,318,000 people living below the poverty line in America, only 2,771,000 of them were working full-time, year-round. Granted, many of those living below the poverty line are minors, and shouldn’t be expected to work full-time. But there are certainly enough adults/heads of households (26,429,000 according to the chart linked above), to wonder why that number is not higher.

So if only 10.48% of adults aged 18-64 living below the poverty line are working full-time, year-round, why would this catch-phrase even be used? Clearly, even if raising the minimum wage does everything the left says it does (increase wages, while magically not causing any layoffs or reduction in long-run employment growth) they will still harm most of those living in poverty, by slightly increasing the cost of living. Prices for commodities and services will undoubtedly increase as you force up the cost of labor for businesses. In what reality is the minimum wage an effective anti-poverty program?

Even worse, if the arguments of the left are incorrect, and raising the minimum wage does in fact make it more difficult for those with low-skills to get a job, one could expect the percentage of people living in poverty, who aren’t working full time, to increase even more. Exacerbating the problem.

To quote the legendary economistThomas Sowell, “There was a time when it was meaningful to speak of “the idle rich” and the “toiling poor” but that time is long past. Most households in the bottom 20 percent by income do not have any full-time, year-round worker and 56 percent of these households do not have anyone working even part-time. Some of these low-income households contain single mothers on welfare and their children. Some such households consist of retirees living on Social Security or others who are not working, or who are working sporadically or part-time, because of disabilities or for other reasons.”

There are two possibilities here.

1. Those living in poverty are people who choose not to work, and who do in fact want to game the system. In which case, many people will lose sympathy for them.

2. Many of them do want to work, and simply can’t find it. Whether it be a bad economy, or their own lack of skills relative to other workers, they can’t get hired.

If the latter is true, the last thing you want to do is raise the minimum wage and make it harder for them to get work in the first place. If the former is true…. well, everything the right has been saying about the welfare state is spot on.